In the National Treasury’s latest published Draft Tax Bills, which incorporates the tax proposals made in the 2021 Budget, the amendment proposes a particularly worrying amendment which may upend taxpayers’ carefully planned retirement. The Draft Taxation Laws Amendment Bill (TLAB) proposes an additional “exit tax” to tax retirement fund interests of individuals when they cease South African tax residency. This proposed amendment, due to come into operation on 1 March 2022, would be a further blow to emigrating South Africans wanting to cease their tax residency, following on from the three-year lock-in rule imposed on retirement annuities earlier this year.
Emigration Tax? ANC Regime to Charge Emigrating South Africans an Additional “Exit Tax” on Retirement Funds!
Expat tax could be ‘final straw’ for South Africans
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For some, the additional tax burden may be so significant that they won’t have any choice but to emigrate. There is a significant risk that multinationals and young, mobile South African tax residents could move to tax-friendly jurisdictions should the foreign employment income exemption be repealed as proposed, experts have warned. “We will raise in..
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